[Congressional Record Volume 141, Number 166 (Wednesday, October 25, 1995)]
[Senate]
[Pages S15599-S15606]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




[[Page S15599]]


             THE BALANCED BUDGET RECONCILIATION ACT OF 1995

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
proceed to the consideration of S. 1357, which the clerk will report.
  The legislative clerk read as follows:

       A bill (S. 1357) to provide for reconciliation pursuant to 
     section 105 of the concurrent resolution on the budget for 
     fiscal year 1996.

  The Senate proceeded to consider the bill.
  Mr. DOLE. I ask unanimous consent that Senator Domenici be recognized 
for up to 60 minutes for debate only and Senator Exon for up to 30 
minutes for debate only.
  Mr. EXON. Reserving the right to object, I would like to make a 
clarification on this, if I might, and I do not think we have a 
difference of opinion on this.
  It is the desire of the majority to move as quickly as we can into 
the amendment process, and as Senator Domenici knows--and I suspect he 
has told the majority leader--we are working to try to cut these down 
to move this proposition along. However, since we are limited to 10 
hours each, as I understand the unanimous-consent request that has just 
been offered by the majority leader, there would be 1 hour off of the 
Republican 10 hours, if we agree to this, and a half an hour on our 
side, which would mean that you are giving up an hour; we are giving up 
a half an hour of our 10. Is that right?
  Mr. DOLE. We would like to have you give up more but we will settle 
for that.
  Mr. EXON. Let us not press it at this time.
  Mr. DOMENICI. That is correct.
  The PRESIDING OFFICER. Is there objection?
  Mr. DOMENICI. Reserving the right to object.
  Mr. DOLE. Let me just say--and I am going to depart here. I first 
want to say I hope we can work out some agreement so that we are not 
having 50 votes here before final passage when you do not have any time 
to debate the amendments. And I think I could speak for my colleagues 
on this side that we would be prepared, if there were a number of basic 
major amendments the Democrats wanted to offer period, we might be able 
to convince our colleagues not to second degree those amendments, if 
there were no other amendments following that. And I know that is being 
worked on, and we hope to reinvestigate that shortly after noon.
  I now have to leave, but I would be happy to work with the Senator 
from Nebraska. We have in the past. Maybe we can this time around.
  The PRESIDING OFFICER. Is there objection?
  Mr. DOMENICI. Reserving the right to object, we have no objection to 
Senator Exon's restatement of the proposition so long as it is not 
intended to in any way change the allocation other than this hour and 
this half-hour.
  Mr. EXON. No, no.
  Mr. DOMENICI. We are not agreeing on different allotments of time or 
different treatment of amendment times.
  I have no objection.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Who yields time?
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, would Senator Exon like to proceed with 
part of his time?
  Mr. EXON. For clarification of all, I was advised the chairman of the 
Budget Committee, and Senator Roth, the chairman of the Finance 
Committee, would be speaking, as I understand it, during part of the 1 
hour that the Senator has reserved. As a result of that, I have alerted 
Senator Moynihan, the ranking Democrat on the Finance Committee, and 
basically I would simply say that the opening remarks beginning on this 
side would be essentially 15 minutes for myself and 15 minutes for the 
ranking Democrat on the Finance Committee, which I think will basically 
take up most of the half hour. Then it is up to the Senator to allot 
the time on that side.
  Is the chairman suggesting that he would like to have me proceed with 
my opening statement at this time?
  Mr. DOMENICI. Yes, I think so other than if the Senator would give me 
3 minutes for a little kind of house-cleaning work.
  Mr. EXON. Yes. And I would ask unanimous consent that this 
housekeeping work not be charged to either side.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. I thank the distinguished Senator.
  Mr. President, I ask unanimous consent that the following staff of 
both the majority and minority on the Budget Committee be permitted to 
remain on the Senate floor during consideration of S. 1357 and that the 
list be printed in the Record.
  There being no objection, the list was ordered to be printed in the 
Record, as follows:

                             Majority Staff

       Karen Bilton, Lisa Cieplak, Jim Hearn, Keith Hennessy, Bill 
     Hoagland, Carol McGuire, Anne Miller, Roy Phillips, Denise G. 
     Ramonas, Cheri Reidy, Ricardo Rel, J. Brian Riley, Mike 
     Ruffner, Melissa Sampson, Jennifer Smith, Austin Smythe, Bob 
     Stevenson, Beth Wallis.

                             Minority Staff

       Amy Abraham, Annanias Blocker, Bill Dauster, Kelly Dimock, 
     Tony Dresden, Jodi Grant, Matt Greenwald, Joan Huffer, Phil 
     Karsting, Jim Klumpner, Daniela Mays, Sue Nelson, Jon 
     Rosenwasser, Jerry Slominski, Barry Strumpf.

  Mr. DOMENICI. Mr. President, I ask unanimous consent that the 
presence and use of small electronic calculators, as we have done 
heretofore, be permitted in the Chamber during the consideration of 
this measure.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. Mr. President, 1 minute off my time at this point and 
then I will yield. To Republican Senators, this is, as I understand it 
for the last few weeks, a very important couple of days. Many of you 
want to speak on subject matters before the Senate and some want to 
just speak about a balanced budget. I want to say to all the Republican 
Senators I am going to do my very best to accommodate you, but I would 
tell Senators that it is not easy to just give you a time when you want 
it. So I would hope that Senators would be flexible, and if we call on 
you, if you turn in your names, if you really want to speak and if we 
call on you, you be able to do it on a half-hour's notice or so because 
I just cannot arrange the floor in any other way.
  Having said that, I yield the floor at this time.
  The PRESIDING OFFICER. The Senator in Nebraska.
  Mr. DOMENICI. Before the Senator proceeds, will the Senator engage me 
in a little dialog about our efforts to see if we can better manage?
  Mr. EXON. Yes.
  Mr. DOMENICI. I believe, Senator Exon, we are going to have some time 
during this hour and a half, you and I, and perhaps your leader and I 
understand you have a small task force.
  Mr. EXON. Yes.
  Mr. DOMENICI. I have asked our leader if we could use his office, so 
I wonder if maybe looking at the clock, if you could arrange a meeting 
at maybe 20 after, 25 after. You would be finished speaking. And we 
would have our side start going. Could we meet in the leader's office 
about trying to reduce the number of amendments and make some 
accommodation?
  Mr. EXON. It sounds reasonable. Are you suggesting the timeframe of 
11:20?
  Mr. DOMENICI. Yes. I said 10 but let us say 11:20.
  Mr. EXON. Agreed.
  Mr. DOMENICI. Let me make sure in this dialog, in this exchange that 
everybody understands----
  Mr. MOYNIHAN. Will Senator Roth have spoken by then?
  Mr. DOMENICI. I hope so. We have sent word for him to come.
  I thank the Senator very much.
  Mr. MOYNIHAN. I thank the Senator.
  Mr. DOMENICI. Everybody knows hopefully that the Senator from New 
Mexico on most matters coming before the Senate that he has anything to 
do with tries to be fair, and I truly intend to do that. But I do want 
to state right up front that there are many Republican Senators, if not 
every one, who do not want to have the Senate go through 50 or 60 votes 
on single targeted issues.
  I might just suggest right up front, for those who are going to do 
that and insist, with the Senator's leadership, that they are going to 
do that, they will not get a vote on their amendment. I mean, they can 
be assured that they will not, because we will indeed 

[[Page S15600]]

second degree those kinds of amendments. And we have as much stamina, I 
think--I do not know--as much stamina as the other side of the aisle.
  Mr. EXON. And more votes.
  Mr. DOMENICI. And more votes. The Senator got it. That is very 
important. We only need 50. Let us make sure that is understood on both 
sides.
  On the other hand, we are meeting to try to see if we can accommodate 
a more amicable approach. And let us hope that we can. I yield the 
floor.
  The PRESIDING OFFICER. The Senator from Nebraska.
  Mr. EXON. Mr. President, I thank my friend and colleague. I want to 
continue to work together. We have sharp differences on these things, 
but I think over the period of time for the 18 years that we have 
served on the committee together we have been accommodating to each 
other. I think that is the desire.
  I will simply say that the chairman of the committee has indicated 
that people on that side are very much concerned about how we proceed 
on this. That is true on this side. Unfortunately, with the time 
constraints that we have, with the mammoth bill we have before us, the 
Senator from Nebraska is going to have to be an unpopular traffic cop, 
trying to direct traffic to say no, since we do not have time. But at 
this time I yield myself 15 minutes, and ask that I be notified if I 
exceed that time.
  Mr. President, there was a marriage on Monday, a marriage that did 
not quite make the wedding notices. As my colleagues know, the 
Republican majority on the Budget Committee generously provided $224 to 
$245 billion in tax breaks for the wealthiest Americans and wedded it 
officially to the $270 billion in Medicare cuts. The seniors of America 
paid for that wedding, and they will pay and pay and pay again over the 
years. The Congressional Budget Office issued the marriage license. In 
an October 20 letter to me, CBO Director O'Neill wrote that without the 
drastic cuts in Medicare, the tax break for the wealthy would not have 
been possible.
  I ask unanimous consent that her letter be printed in the Record at 
the conclusion of my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Mr. EXON. The happy couple of tax breaks and Medicare cuts are now 
before the Senate in the form of the reconciliation bill. They are 
asking for our blessing. We should not give it. This marriage should be 
annulled. Had the question been asked, ``Is there anyone present who 
objects to the joining of these two, speak now or forever hold your 
peace?'' I would have objected.
  Mr. President, it has been almost 4 months since the Senate passed 
the conference report on the budget resolution which begat this 
reconciliation bill, a bill that has now grown to grotesque 
proportions.
  This reconciliation bill was created behind closed doors. It is the 
first of the illegitimate births of this union. By comparison, it makes 
``Rosemary's Baby'' look like a dream child. They brought it out into 
the light of the day for the first time at midday last Friday. There 
were no hearings on Medicare. There were no hearings on Medicaid. There 
were no hearings on the cuts of the earned income tax credit. There 
were no hearings on the cuts in education. There were no hearings on 
how this budget cuts a huge swath like a tornado through rural America.
  Last Friday, during the markup of this reconciliation bill, I asked 
if we could not hear from just four witnesses who could describe how 
this Republican budget would do great violence to their lives. I asked 
for an hour. That is just 1 minute for each $4.5 billion in Medicare 
cuts. But my offer was spurned.
  Why the hurry, Mr. President? Why is the majority so breathless about 
sealing the deal on this budget? Why are they now moving in convoy 
fashion to pass this bill? The great pitcher, Satchel Paige, might have 
had the answer. He once said, ``Don't look back. Something might be 
gaining on you.'' Something is gaining on the Republicans. They are 
hearing footsteps. They are hearing the American people gaining on 
them. More and more Americans are finding out what is in this monstrous 
bill. And they feel deceived and betrayed.
  Mr. President, I will speak in a moment about the particulars of this 
reconciliation bill and the terrible hardships that it inflicts. But I 
would like to take a moment to discuss what I believe is the large 
picture here.
  When we get into these debates about budget resolutions and budget 
reconciliation bills, Senators can all too easily lose sight--lose 
sight--of the ordinary Americans. The stage overshadows the people on 
it. In this same vein, my colleagues on the other side cannot see 
beyond the gesture of the moment. They cannot see beyond the 
scaffolding they have erected in this reconciliation bill. They cannot 
see the people that they will harm. They cannot see the Nation that 
they are tearing apart. This Republican budget does not speak to the 
American values that I know and the ones that I cherish, values that I 
see every day in my fellow Nebraskans. The greatest of these values are 
shared sacrifice, fairness, and compassion for our neighbors. That is 
the social fabric that runs through our great Nation. But this 
Republican budget is tugging at every thread to unravel it.
  In spite of the inflated rhetoric, the Republican budget reached a 
shallow bottom in no time at all. Some have called it social Darwinism 
at its shabby worst, I say, where citizens are pitted against citizens, 
young against the old, rural Americans against urban Americans.
  Last week Speaker Gingrich feigned that he wants no class warfare. 
What nonsense. It is this bill that fires the first shot of class 
warfare. It is this bill that goes to war against the working people on 
behalf of the wealthy.
  Mr. President, the more this budget is exposed to the sunlight, the 
more we are finding that this is not the right key to open a 
complicated problem which we all agree is necessary--balancing the 
budget.
  I am one of the few Senators who has actually balanced budgets and 
used the line-item veto to do it. I did it for 8 years as Governor of 
Nebraska. But I say to my colleagues today, this Republican budget is 
not the way to do it. Tax breaks for the wealthy are writ large all 
over this reconciliation bill. Tax breaks for the wealthy have riveted 
the attention of the Republicans to the exclusion of everything else. 
Tax breaks for the wealthy have established primacy over time-honored 
commitments to provide a safety net for our fellow citizens.
  Medicare became the most convenient laboratory for conducting these 
tax breaks. The Republican Medicare plan cuts the program three times 
more than necessary to keep it solvent through the year 2006, just to 
pay the freight for the tax breaks.
  The Republican reconciliation bill doubles the premiums under part B 
Medicare. It doubles the deductibles under part B. It increases the 
Medicare eligibility age from 65 to 67, all for the tax breaks.
  And on October 2, in an editorial in the New York Times, the Times 
states, and I quote:

       Right now, Medicare makes up less than 12 percent of the 
     Federal budget. But Medicare cuts account for more than twice 
     that percentage of the lower spending in the Republican 
     approved budgets over the next 7 years. Not withstanding Mr. 
     Gingrich's appeal, the facts clearly demonstrate that health 
     programs for the elderly are bearing a disproportionate share 
     of the austerity pushed by the Republicans.
  Mr. President, I ask unanimous consent that the full editorial that I 
have referenced in the New York Times be printed in the Record at the 
conclusion of my remarks.
  The PRESIDING OFFICER (Mr. Frist). Without objection, it is so 
ordered.
  (See exhibit 2.)
  Mr. EXON. Mr. President, the shocking truth is that more than 88 
percent of the Republican mandatory cuts come from means-tested 
programs, those which serve predominantly low- and moderate-income 
Americans, and from Medicare, where three-quarters of the beneficiaries 
have annual incomes under $25,000.
  A Joint Economic Committee study also concluded that the poorest 
fifth of Americans would shoulder fully half of the proposed program 
cuts, for an average loss of nearly $2,500 per family in the year 2002. 
There are no breaks for these folks in this Republican bag of tricks.

[[Page S15601]]

  The Republicans trumpet that their tax breaks will benefit all 
Americans, especially the middle class. The truth, however, sounds a 
different note, and it is definitely sour.
  Last week, the Joint Committee on Taxation confessed that families 
making up to $30,000 a year--and that is about half of all taxpayers--
would actually see their taxes go up under the Republican tax plan. 
Yes, Mr. President, their taxes would go up. They would pay more for 
increased Medicare premiums and deductibles. They would pay more for 
new student loan fees. They would pay more for higher taxes on State 
and local employees. They would pay more for higher contributions for 
GI bill benefits.
  What about the other side of the gilded reconciliation bill? The 
Treasury Department estimates that nearly half--nearly half--of the 
Senate's tax breaks would go to 12 percent of the American families 
making $100,000 a year or more.
  The New York Times also said, and I quote:

       The Republicans are rushing through Congress the greatest 
     attempt in modern history to reward the wealthy at the 
     expense of the poor.

  Earlier in my statement, I mentioned that the Republicans are not 
only pitting young against old and rich against the middle class, but 
our rural areas against urban industrialized centers throughout the 
many States of our great land.
  This Republican reconciliation bill is a cruel joke, above everything 
else, upon rural America. More than 9 million rural Americans will pay 
higher out-of-pocket costs for second-class Medicare programs. The 
typical rural hospital could find its annual budget cut by a third, 
forcing many to close and causing many physicians to leave and to never 
return. Medicaid cuts will eliminate coverage for 2.2 million rural 
Americans, including 1 million children. Net farm income will decline 
by $9 billion over the next 7 years. And for what, Mr. President? Once 
again, for the almighty tax breaks for the wealthy.
  The evidence clearly keeps mounting. It is compelling. It is heart-
wrenching. This reconciliation bill is wrong for our great Nation. For 
the good of our Nation, it should be defeated. At a time when we should 
be formulating a balanced budget that unites America and unites its 
people, this one only seeks to divide us.
  We know that this reconciliation bill will be vetoed by the 
President. Those of us who reject the extremism of the day, both 
Republicans and Democrats, should be looking beyond this doomed 
reconciliation bill. We should be looking to a workable alternative, a 
compromise. We should be looking toward building on the structures and 
values of our great Nation, not tearing them down.
  I have offered before, and I offer again now, to my Republican 
colleagues: Come, let us reason together and develop a true and 
workable compromise. If we can stop this Republican juggernaut and stop 
it now, we can get on with fashioning a reasonable formula to balance 
the budget.
  The PRESIDING OFFICER. The Senator has used his time.
  Mr. EXON. I allocate myself 2 additional minutes.
  Mr. President, if we pass this bill, it will certainly receive a 
Presidential veto, and we will belatedly start all over again.
  The American woman of letters, Lillian Hellman, once commented: ``I 
cannot and will not cut my conscience to fit this year's fabric.''
  Nor will I, Mr. President. I will vote against this budget, and I 
urge my colleagues to do the same.
  I reserve the remainder of my time, and I yield the floor.

                               Exhibit 1

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                 Washington, DC, October 20, 1995.
     Hon. J. James Exon,
     Ranking Minority Member, Committee on the Budget, U.S. 
         Senate, Washington, DC.
       Dear Senator: Pursuant to Section 205(a) of the budget 
     resolution for fiscal year 1996 (H. Con. Res. 67), the 
     Congressional Budget Office on October 18 provided the 
     Chairman of the Senate Budget Committee with a projection of 
     the budget deficits or surpluses that would result from 
     enactment of the reconciliation legislation submitted to the 
     Budget Committee as of that date. As stated in the letter to 
     Chairman Domenici, CBO projected that there will be a total-
     budget surplus of $10 billion in 2002, using the economic and 
     technical assumptions underlying the budget resolution, and 
     assuming the level of discretionary spending specified in 
     that resolution. If the estimated Medicare savings in 1996 
     through 2002 resulting from the legislation submitted by the 
     Finance Committee were excluded from the calculation, CBO 
     would project a deficit of $82 billion in 2002. Similarly, if 
     any other savings submitted to the Budget Committee were 
     excluded from the calculation, CBO would project a higher 
     deficit.
       CBO also stated in the letter to the Chairman that the 
     estimated deficit reduction would likely reduce federal 
     interest costs and increase revenues by an amount similar to 
     the fiscal dividend that CBO discussed in its August report, 
     The Economic and Budget Outlook: An Update. If deficit 
     reduction in each year were lower by the amount of the 
     estimated Medicare savings (and the associated debt service), 
     the fiscal dividend would likely be lower than the estimated 
     CBO published in August.
       If you wish further details on this projection, we will be 
     pleased to provide them. The staff contact is Jim Horney, who 
     can be reached at 226-2880.
           Sincerely,
     June E. O'Neill.
                                                                    ____


                               Exhibit 2

                [From the New York Times, Oct. 22, 1995]

                      Class Conflict in Washington

       How touching it was for House Speaker Newt Gingrich to 
     appeal for brotherly love at the end of the titanic debate 
     over Medicare last week. ``We want no class warfare,'' he 
     declared. ``We want no conflict between generations.'' Even 
     by Mr. Gingrich's standards, this was a remarkable statement. 
     The Republicans are rushing through Congress the greatest 
     attempt in modern history to reward the wealthy at the 
     expense of the poor. They are also sacrificing the health 
     needs of the elderly to pay for a tax cut for the affluent. 
     Incredible, Mr. Gingrich was accusing the Democrats of 
     formenting class and generational resentments by pointing 
     this out. President Clinton can do no less than veto the 
     Republican legislative package that is roaring toward passage 
     in Congress.
       We have long argued that Medicare, the health insurance 
     program for elderly Americans, is in need of reform. Many 
     Republican ideas for introducing competition into the health 
     care system and forcing providers to deliver care more 
     efficiently are sound. But the cuts being pushed through 
     Congress are so big they threaten to dry up money for medical 
     training, devastate nursing homes and drive hospitals and 
     doctors away from taking care of Medicare patients. Right 
     now, Medicare makes up less than 12 percent of the Federal 
     budget. But Medicare cuts account for more than twice that 
     percentage of the lower spending in the Republican-approved 
     budgets over the next seven years. Notwithstanding Mr. 
     Gingrich's appeal, the facts clearly demonstrate that health 
     programs for the elderly are bearing a disproportionate share 
     of the austerity pushed by the Republicans.
       The charge that Democrats have been playing on American 
     resentments has also been sounded by Bob Dole, the Senate 
     majority leader, who recently accused Mr. Clinton of 
     encouraging ``envy and class warfare.'' He made it sound 
     almost Marxist to discuss which classes gain and which lose 
     in any legislation. True, the Democrats are playing the 
     politics of winners and losers,but their criticisms are 
     rooted in a certain reality.
       It was the Republican-controlled Joint Taxation Committee 
     that acknowledged last week that families making up to 
     $30,000, about half of all taxpayers, would actually see 
     their taxes go up under the tax package heading toward 
     approval in the Senate. The reason is that the Republicans 
     are insisting on scaling back the earned-income tax credit, 
     which goes to low-income workers to keep them out of poverty. 
     The Treasury Department estimates that nearly half the 
     Senate's $43 billion in tax cuts, meanwhile, would go to the 
     12 percent of Americans in families earning $100,000 or more.
       On the spending side, it takes ideological blinders to 
     argue that Republicans are not waging their budget wars on 
     the poor. The budget bills racing through Congress embody a 
     gargantuan $1.1 trillion in spending cuts over the next seven 
     years, according to the nonpartisan Congressional Budget 
     Office. Out of this sum, the Center on Budget and Policy 
     Priorities, a liberal group, estimates that welfare, 
     Medicaid, food stamps, housing and other programs for the 
     poor are being cut by 37 to 47 percent. That is far more than 
     seems fair given that only 21 percent of the Federal budget 
     is spent on the poor.
       Another way of looking at this is to see how the 
     Republicans are approaching the two biggest health care 
     programs in the country. Medicare is for everyone and 
     Medicaid is for the poor. Both have been growing out of 
     control and have to be reined in. But cost estimates of the 
     Congressional Budget Office show that Medicare is being kept 
     by Republican legislation at a 6.4 percent growth rate in the 
     next several years and Medicaid is being kept as a 4 percent 
     growth rate. There is no way to see this except as a 
     deliberate effort to inflict greater hardship on those 
     delivering health care to the poor.
       The Republican Congressional handiwork of the last week 
     provides a reminder of a grim truth. It is much easier to 
     destroy something than it is to create it. Reform of many of 
     these programs is surely in order. 

[[Page S15602]]

     But reform is certain to be undermined if it is coupled with 
     a reactionary redistribution of government resources.
       In the coming weeks and months, the House and Senate will 
     be struggling to reconcile their differences and put them in 
     one massive piece of legislation, possibly attaching it to a 
     measure keeping the United States out of default, Mr. Clinton 
     must not be rattled by the threat. If he stands firm, the 
     Republicans will be forced to scale back their assault and 
     confront the reality that a huge and regressive tax cut is 
     inappropriate as a matter of social equity and fiscal common 
     sense.

  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, under the unanimous-consent agreement, 
we have almost 1 hour on this side?
  The PRESIDING OFFICER. Fifty-nine minutes.
  Mr. DOMENICI. I yield myself 15 minutes, and then I am going to 
excuse myself for a half hour or so and see what we can negotiate with 
the Democrats in terms of a more orderly process than confronts us 
today.
  Mr. President, to all those interested in today's debate, let me 
suggest the other side, including my good friend, Senator Exon, plays 
very loose with words like ``truth'' and ``right.'' As a matter of 
fact, before this debate is finished, I believe most of the contentions 
about the poor and about the rich will be dispelled and be disposed of. 
I think the Joint Committee on Taxation will acknowledge before this 
day is out that their estimates of the tax bill were wrong and based on 
erroneous assumptions. I believe we will prove that this is a fair 
budget.
  Frankly, for those who think only of 10 days and of the next 
election, obviously they can come up with something much easier. But we 
are not talking about 10 days and the next election; we are talking 
about 10 years, we are talking about 50 years, and we are talking about 
our children and grandchildren.
  Anybody who does not want to do that and wants to just say to 
America, ``Don't worry about it, seniors, don't worry about it; we have 
amendments that will leave everything status quo,'' just listen. That 
is how America will fall. That is how America's money will become 
worthless. That is how interest rates will skyrocket. That is how our 
standard of living, which is already in jeopardy for a lot of things, 
will come falling and tumbling down. Because if we do not tell the 
truth about the fact that we are incurring debt at such an outrageous 
amount, we are saying we are talking about only 10 days or 6 months, do 
not worry about 10 years, do not worry about the future, worry about 
politics.
  I believe when we are finished and when the President of the United 
States finally agrees to a real budget, the seniors are going to say, 
``What was this argument all about?'' Medicare will be intact. Seniors 
will be taken care of across the land and, yes, they may be even 
surprised. They may decide to join some institutions that will deliver 
services differently, and they may save money. As a matter of fact, 
they may find in the next 2 or 3 years that they get more care and 
better care than under the Medicare Program we have today.
  Let me dispose of two items. The distinguished Senator from Nebraska 
says we are doing all these things to the poor people of the country. I 
assume he is suggesting that we are cutting food stamps, child 
nutrition, AFDC, and that he really means they are being cut.
  I want to insert in the Record just one simple chart. Food stamps, 
AFDC, child care, child nutrition, SSI, Medicaid, and EITC. In the year 
1996, we will spend $195 billion on those programs. The next year, $202 
billion; the next year, $211 billion; the next year, $221 billion; the 
following year, $235 billion. In summary, by the year 2002, these 
programs, which today are at $195 billion, will be $253 billion. Now, 
that is not contending anything. It is merely stating the facts of this 
reconciliation bill, as found by the Congressional Budget Office.

  How about hearings? Just one little statement about hearings. The 
last time the Democrats controlled this body, they did the President's 
bidding. I believe some of them are sorry they did because, of late, he 
has suggested they had been duped. He did not want all those taxes you 
all voted for--only $270 billion, the largest tax increase in history. 
He is suggesting that somebody made him do it. As an aside, I want to 
say to the Democrats in this institution that that is not only bunk, he 
actually asked for $360 billion; you reduced it to $270 billion, 
because he had the Btu tax in there.
  Mr. MOYNIHAN. Against my better judgment. We reduced it against my 
better judgment.
  Mr. DOMENICI. Senator Moynihan wanted to keep it higher. This is the 
chronology for the budget process. When they were in control, the 
number of hearings held by the then Democrat Budget Committee was 7; 
the number we held was 22. The number of witnesses who offered 
testimony in the Senate Budget Committee, throughout their hearings, 
was 10; we had 110. The number of days the Budget Committee spent in 
markup, they had 3; we had 4, giving them more opportunity to express 
themselves. The number of days spent in conference, they had 6; we had 
18. We make no apologies with reference to hearings. We had plenty of 
hearings and the Budget Committee set the targets.
  Mr. President, I want to suggest, by using just two quotes, what this 
issue is about. Thomas Jefferson said:

       The question of whether one generation has the right to 
     bind another by the deficit it imposes is a question of such 
     consequence as to place it among the fundamental principles 
     of government. We should consider ourselves unauthorized to 
     saddle posterity with our debts and are morally bound to pay 
     them ourselves.

  That is what this debate is about. Do we want to pay our debts, or do 
we want our children and grandchildren to pay for the Government we 
want to give to people that we cannot afford?
  To put it another way, a modern lawyer and thoughtful person on 
America's Constitution, Laurence Tribe, philosophically a liberal 
lawyer from Harvard, said:

       Given the centrality in our revolutionary origins of the 
     precept that there should be no taxation without 
     representation, it seems especially fitting in principle that 
     we seek somehow to tie our hands so we cannot spend our 
     children's legacy.

  Now, we are bent today and tomorrow on this floor to decide what kind 
of legacy we are going to leave our children--a legacy of debt, of 
diminished standard of living, a legacy which says to them, ``We want 
you to work perhaps 30 or 40 percent of your working lives to pay our 
bills,'' for they will have to do that. It is estimated, Mr. President, 
that every child born today will spend at least $100,000 in new income 
tax to pay just the interest on the national debt. What kind of legacy 
is that? Is that a legacy that should permit us to hide from reality 
and to say to our seniors and our young people and our veterans and our 
students--every American--``You do not have to worry about it, we are 
going to leave everything alone. Whatever you are getting from your 
Government, you can keep getting.'' The legacy for that kind of 
leadership is a bleak future for the greatest Nation on Earth--$4.7 
trillion in debt, and rising at the rate of $420 million a day; $420 
million a day, just tick it off, tick it off. We will be here for 2 
days, so that is $420 million times two while we decide a Republican 
proposal that says we have to stop it.
  Now, before you pass judgment, fellow Senators and fellow Americans, 
about the bill and the summaries that will be given from the other 
side, hear from those who put the package together and put the programs 
together on our side. Somewhere you can pass judgment upon whether we 
are being fair or unfair. I believe you will come down on the side of 
saying that this is fair to our children and to our children's future, 
and everybody has to be part of the change that will bring that into 
fruition a couple of nights from now.
  I must say to the President of the United States that veto and veto 
threats, as you might want to issue them day by day, do not get you a 
balanced budget; nor does it get you close to eliminating a legacy for 
our children and grandchildren of servitude, or perhaps a partial 
servitude of that next generation to ours, for they will work to pay 
our bills. Mr. President, is that the kind of leader you want to be? 
Democrats on the other side, is that what you want to be? You are going 
to bring before us, one at a time, amendments to strike pieces of this, 
and each 

[[Page S15603]]

one is going to sound neat, sound worrisome. I hope every single one of 
them is defeated, and I hope we take this budget resolution to 
conference and then to the President of the United States and let us 
see what he does; let us see what he offers. Mr. President, we extend 
that to you now, and we say it is going to happen. So get ready, Mr. 
President. Be prepared for what you are going to do when we give you 
this package. Fellow Democrats, we understand you differ with us. We 
will try our best to be truthful and to point out where you are wrong. 
In many of the statements made to the American people you are wrong on 
the facts. We will try to get them before you.
  Having said that, I assume I have used 15 minutes, is that correct?
  The PRESIDING OFFICER. The Senator has used 11 minutes.
  Mr. DOMENICI. I do not want to reserve any of my time.
  Mr. KENNEDY. May I have 15 seconds for a question?
  Mr. DOMENICI. Sure.
  Mr. KENNEDY. I am wondering when the Senator is going to explain the 
justification for the tax cuts. I have been on the floor listening to 
the justification that the Senator has given, without a single word 
about what the justification is in this bill for the tax cuts for the 
wealthiest individuals. I have not heard a discussion about the 
implications of that in those terms.
  Mr. DOMENICI. You can rest assured that we will answer that. Many 
issues have been raised, and I am trying to give an overview. That will 
be answered a number of times.
  Mr. MOYNIHAN. Could it be that you delegated that joyous task to the 
chairman of the Finance Committee?
  Mr. DOMENICI. My friend knows that each committee does their work. He 
is in charge of that work. I will not take a back seat to anybody on 
explaining the tax bill. I do not know it in detail, but I think it is 
a very good tax bill. When the American people understand where the tax 
cuts really go, they are going to find out that what we said we would 
do was get a balanced budget, and we did; and then the economic 
dividend that comes from that, we would use to give American people 
back some tax dollars so they could spend it themselves. We think the 
tax writing committee has come very close to doing that in a way that 
almost all of that money will go to middle-income Americans, making 
$110,000 and under. We will show that unequivocally, and I believe the 
Joint Tax Committee will be saying that, too.
  Mr. EXON addressed the Chair.
  The PRESIDING OFFICER. The Senator from Nebraska [Mr. Exon] is 
recognized.
  Mr. EXON. Mr. President, point of inquiry; how much time does the 
Senator from Nebraska have under the unanimous-consent agreement in 
place now?
  The PRESIDING OFFICER. The Senator from Nebraska has 14 minutes.
  Mr. EXON. Mr. President, upon his seeking recognition, I ask 
unanimous consent the Chair recognize the Senator from New York, and 
the remaining time under my discretion is allocated to the Senator from 
New York.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. Mr. President, one observation, please and then I yield 
the time that Senator Brown desires, with the Senator from Michigan 
controlling our time after that.
  Mr. President, I forgot to mention on the tax cuts, obviously the 
President thinks the taxes were raised too much last year under his 
proposal. One way of looking at it, we are getting set to right that 
wrong which the President complained about in Houston, about which he 
was beginning to say he should not be blamed for that tax increase.
  We will accommodate and reduce some taxes so that maybe he can 
support us on that.
  I yield to Senator Brown.
  Mr. BROWN. Mr. President, I rise for just a short comment because I 
think it is important for the American people to keep this perspective 
in mind.
  This package has been attacked by those opposed to it. That is the 
privilege and indeed the obligation of Members who find this 
unacceptable. No one should be fooled as to the contents of this 
package. This package ensures that Federal spending goes up 3 percent a 
year instead of 5 or 6 percent.
  Now, some Members find that unacceptable, some find that cruel and 
inhumane. As a matter of fact, the description that was just given by 
the Democratic Budget Committee leader compared the package to 
```Rosemary's Baby'--a look-alike dream child.''
  Mr. President, indeed, there are some Americans, particularly in 
Congress, particularly on the spending side, who think that increasing 
spending only 3 percent a year is the worst thing that has ever 
happened in Western civilization. We will hear a lot about that in 
debate.
  The American people ought to keep in mind what this is. This is a 
plan to increase spending 3 percent a year instead of 6 percent a year. 
The difference is our future. By controlling the increases to a 
moderate rate we are able to offer a future to our children and our 
grandchildren. We are able to focus on the deficit. Mr. President, 
without doing that we consume their future with debt, deficits, and 
economic stagnation.
  Mr. President, I simply want to make one other point that I think is 
relevant to this debate and very important. I hope the American people 
who listen to this, who listen to the rhetoric that has been made about 
this budget plan, will understand that we are not talking about cuts in 
most programs. What we are talking about is slowing the rate of 
increase.
  In the discussion of tax cuts, let me simply mention that I hope 
Members will be on guard, or Americans will be on guard, as they 
listen. I have heard the most incredible debate of the tax cuts that I 
have ever heard or I ever thought I would hear in my life. Pinocchio's 
nose would be a world-record length if he had to listen to the 
discussions that we have had put on.
  Let me give an example. I have heard of tax credits that are not yet 
implemented as being called increases in taxes. That is ludicrous. I 
have heard welfare programs that are being controlled in the rate they 
spend money as being increases in taxes.
  Mr. President, an increase in spending is an increase in spending. A 
cut in spending is a cut in spending. Frankly, the American people have 
the good judgment to see through this kind of rhetoric.
  What we need are real valid estimates. What we need is a solid budget 
that gets us where we want to go.
  Mr. President, there is only one budget that is considered here today 
that will do that. There is only one budget that has been certified by 
the Congressional Budget Office as meeting those targets. There is only 
one alternative that brings us to a real balanced budget. That is the 
budget before us. This is the only game in town.
  Are there critics? Of course there are critics. Are there people who 
simply cannot live with limiting growth of Federal spending? Of course 
there are.
  Everyone knows this country does not have a future if we do not do 
the kind of things that are in this budget.
  The question is whether or not we will act for blue smoke and 
mirrors, for invalid assumptions that the President suggests, or 
whether we will opt for the real thing.
  Mr. President, this is the real thing. It offers a future to 
Americans. I retain the balance of our time.
  Mr. MOYNIHAN. Mr. President, we are awaiting the arrival of the 
distinguished chairman of the Finance Committee who will set forth the 
proposals of the tax cut in this measure.
  I say to my friend from Colorado that it might surprise him, there 
are those on this side of the aisle who see the debt crisis in the same 
crisis terms that he does and have a feeling that we know when it arose 
in the 1980's, and it was not from this side of the aisle--and we want 
to get hold of it.
  We do not think you can solve a deficit problem by cutting taxes.
  Mr. BROWN. Mr. President, I simply observe--and I greatly respect the 
distinguished Senator from New York, both his intellect and his 
integrity--from this Member's viewpoint, I believe an objective review 
of the programs that have risen in increased spending would indicate 
that the programs that are in question were not adopted during the 
1980's.
  I think any objective review of the question of the deficit will 
indicate that.
  Second, I observe that there were valiant efforts made during the 
1980's, a few by this Member. I am not sure I describe my efforts as 
valiant but they 

[[Page S15604]]

were persistent and they were consistently rejected by Democratic 
majorities in the House of Representatives where I served.
  At least from this Member's point of view, if you want to talk about 
the history of the deficit, you look at when those programs were passed 
and who put them on automatic pilot.
  Second, I think you cannot but look at the record and recognize that 
the Democratic-controlled Congress, at least in the House of 
Representatives during the 1980's, consistently opposed efforts to 
control that spending and limit the increase in spending.
  I retain the balance of our time.
  Mr. KENNEDY. Mr. President, where is the current time being charged?
  The PRESIDING OFFICER. The time is under the control of the Senator 
from Michigan and the Senator from New York.
  Mr. KENNEDY. Mr. President, who is being charged with the current 
time?
  The PRESIDING OFFICER. If neither side yields time the time is 
distributed equally between the two sides.
  Mr. KENNEDY. Could we have the attention of the Senator from New 
York?
  As I understand, the time is being charged against us at the present 
time. I just had a question for the Senator from Colorado for 15 
seconds.
  The PRESIDING OFFICER. Time is running equally at this time.
  Mr. MOYNIHAN. Mr. President, I yield 15 seconds to the Senator from 
Massachusetts.
  Mr. KENNEDY. Could the Senator from Colorado, regarding his review of 
the period of the 1980's--does the Senator understand every year what 
was actually appropriated by the Congress, with the exception of 1 
year, was less than what was actually requested by President Reagan 
during that period of time?
  Mr. BROWN. Let me say to the Senator, at least from this Member's 
viewpoint, that the relevant facts are not what was appropriated in the 
original. It was what Congress ended up spending.
  If you look at what is totally spent by Congress versus what they did 
with the congressional budget, you come up with a much different 
viewpoint.
  The fact is during that period Congress continuously overspent its 
own budget; so to compare it with official budget requests I think does 
not give the accurate picture.
  The PRESIDING OFFICER. Who yields time?
  Mr. ABRAHAM. I yield the Senator from Iowa 10 minutes.
  Mr. GRASSLEY. We ought to be very proud, Mr. President, of delivering 
in this Congress on a promise that Congresses have made probably for 
the last 15 years and maybe even longer than that, that we are going to 
balance the budget and that we have a nonpartisan Congressional Budget 
Office certification that we are balancing the budget.
  Balancing the budget is the most important goal that we have 
accomplished since I have been a member of the Budget Committee, and I 
am glad we are able to do that.
  Some people question whether or not we ought to decrease taxes as 
well as balance the budget. There are people that might say we ought to 
decrease taxes and forget about balancing the budget; there are other 
people that would say we might balance the budget and forget about 
decreasing taxes.
  To me, it is a question of priority. The priority is to balance the 
budget. And if we can have tax cuts, and they are paid for, and the 
nonpartisan budget office will certify that we have a balanced budget, 
then it seems to me we ought to give the people back some of the money 
that the President took in OBRA '93. He said that he understands that 
he raised taxes too much 2 years ago. This will not give back all the 
money obtained when the President raised taxes then, but it will go a 
long way toward correcting that inequity.
  So, in a very historic way--at least historic as far as the last 15 
years is concerned--we have a chance today and tomorrow, during this 20 
hours of debate, to show the people that the promises of the last 
election are delivered, those are the promises of a balanced budget and 
of a paid-for tax decrease. It seems to me that a balanced budget will 
go far in making our children's and grandchildren's futures much 
brighter and more hopeful.
  I think this is a very, very good national program. It is good for 
all 50 States. But I can look at it and say it is good for my State as 
well as it is for the country as a whole. I look at the $500-per-child 
tax credit. This credit will bring approximately $300 million back into 
the pockets of Iowans, the pockets of middle-class working families in 
my State.
  For the first time since 1986, students in my State, as well as those 
in the Nation as a whole, will be able to claim a tax credit for the 
interest on student loans because this bill provides a credit for 20 
percent of the qualified interest, up to $500 per student.
  This legislation is not partisan. This legislation is bipartisan 
because it is identical to the bill that I introduced earlier this year 
with my distinguished colleague from Illinois, Senator Moseley-Braun. 
The Joint Committee on Taxation estimates that this credit will send 
over $1 billion to young people all over the country who are just 
starting out in life after college. This change should especially aid 
young people who plan to stay in rural America instead of having to 
seek high-paying jobs in the cities to meet loan payments.
  In addition to that, for the benefit of the country as a whole and 
the benefit of people in my State, there is a capital gains tax cut 
that will reduce an individual's effective capital gains tax rate by 50 
percent. In Iowa we will be able to watch and see a lot of farmland and 
a lot of other capital assets that have been tied up begin to change 
hands. People have been waiting for the correct incentive and 
opportunity to sell because they naturally do not want to pay a high 
tax on inflation because that is not taxation, that is confiscation. 
You are going to see formerly less productive property change hands at 
record rates. This is going to be very beneficial for families passing 
on to younger generations the fruits of their labors and their 
investment in that business or that farm. Of course, when property is 
tied up in the Tax Code, that means our farm population is going to 
continue to get older, the average farmer in my State is 62 years old. 
Young people are not going into farming because they cannot. Only 3 
percent of the farmers in my State are under 30 years of age. We have 
lost a whole generation of farmers because of bad tax policy and 
depression in agriculture in the 1980's. This will help that.
  The same for the changes we are making in the estate tax; especially 
it is going to help family farmers and small business people. Family-
owned businesses and farms do not have to be sold anymore in order to 
just pay the Federal taxes. The estate tax system will now serve small 
businesses instead of consume them.
  While we are fixing the business of taxing small business, this bill 
also ratchets up the unified credit exemption equivalent all the way 
from $600,000 to $750,000. It has been at $600,000 since 1980 and, of 
course, it has been depleted considerably by the inflation of the last 
15 years. The legislative move from $600,000 toward $700,000 recognizes 
both the fact of inflation and the fact that every asset in Iowa is not 
a member of a qualified family-owned business.
  For my colleagues who are going to rant and rave about an estate tax 
exemption helping rich people, I hope they will take a little bit of 
time to understand that when you are talking about a family farm 
operation, operated just by family members who are providing the 
capital, providing the labor, providing the management, that you do not 
provide a job on a family farm for the same cost that you do in 
industrial America, about a $50,000 investment. For the American 
service industry, you can create a job for about $10,000 to $15,000 a 
year. Jobs on farms in America are created by the investment or the 
borrowing--and in most cases to get started it is borrowing--of 
hundreds of thousands of dollars in land and machinery to create one 
job, or an income for one family. I am not talking about hiring a lot 
of labor in the process. I am talking about the family doing the labor.
  So you have, after a life of work, one half million dollars invested 
in land and machinery to create one job and one family income. Some 
people in this body might think small farmers are rich. Maybe a lot of 
America will think small farmers are rich. But, remember, 

[[Page S15605]]

small farmers create income for one family. It is not like the economy 
does in an industrial job, one income for a family with $50,000 
investment and somebody else is investing it, somebody else is managing 
it; or in a service job where the economy needs only $10,000 or 
$15,000.
  We are also providing, in this bill, tax changes that are meaningful 
in ending the marriage penalty for nonitemizers. We are answering the 
pleas of a lot of young people everywhere who want to know why their 
Government is penalizing them for exchanging marriage vows.
  This bill says we are not going to tax reasonable dues to farm 
organizations. This IRS ruling, as stupid as it is, creates a lot of 
problems for a lot of cooperatives and nonfarm organizations out there. 
Just like the President's tax increase last year--albeit in that 
instance it was something passed by a Democrat controlled Congress, and 
not some uninformed ruling by the Internal Revenue Service.
  Finally, I would like to highlight that this bill also improves and 
expands IRA's. We are reinstating an IRA to which working people can 
make tax-deductible contributions. Even homemakers and even nonworking 
spouses will be able to make contributions for the first time ever. 
There will be penalty-free taxable withdrawals for qualified uses.
  Everyone knows that we need to double the current savings rate of 4 
percent. Young people in my State know that they will have to save for 
their own retirements while they are financing the retirements of baby 
boomers, and the IRA incentives in this bill will provide the 
opportunity. Expanding and strengthening the individual retirement 
accounts is something I supported for many years. I am glad to see 
those efforts bear fruit, and I compliment the new chairman of the 
Finance Committee, Senator Roth, for getting that job done.
  The PRESIDING OFFICER. The 10 minutes of the Senator has expired.
  Mr. GRASSLEY. I am going to yield the floor. I am not done, but I 
want to inform my colleagues I have spoken all I wanted to on the tax 
provisions. I do have something I want to say on the Medicare 
provisions, and I will get time on that later on.
  Mr. MOYNIHAN. Mr. President, I yield myself the balance of the 
opening Democratic time. I had hoped to speak in response to my good 
friend, the distinguished chairman of the Finance Committee. He is 
unavoidably detained. So I will go ahead as if in rebuttal.
  But first to continue the exchange I was having with the Senator from 
Colorado, there are those on this side of the aisle who are deeply 
offended by the continuing deficits which have increasingly produced 
stalemate in our Government. This sequence began in the late 1970's, 
early 1980's, and there was an idea behind it--the idea was that, if 
you wanted to paralyze the Federal Government you simply put it into a 
paralyzing debt by the reduction of revenues and simultaneously 
increasing spending on defense and such matters. Indeed, that happened. 
We forecast it. We tracked it. And we are here today to say that it is 
the case.
  Just a few years ago in a wonderful book ``The Deficit and the Public 
Interest,'' Joseph White, and the late revered Aaron Wildavsky, said: 
``Strife over the deficit has affected procedure as well as policy, 
monopolizing the congressional agenda, encouraging paralyzing and 
deceptive legislation like Gramm-Rudman, frustrating our public 
officials, and stalemating the Government.''
  As regards deceptive legislation, Mr. President, I have to place this 
present proposal in that category. We are not balancing the budget. We 
are adding $700 billion to the debt in the next 7 years. One of the 
ways we are doing it is, while talking about the deficit, while talking 
about the debt, we are going to cut taxes. Well, no. No, Mr. President. 
I correct myself. I correct myself. We are going to raise taxes on half 
the population, and cut taxes on the other half.
  Mr. President, here is a table from data produced by the Joint 
Committee on Taxation, which is an authoritative, intermittently 
nonpartisan, body which calculates the effects of tax measures taken by 
the Committee on Ways and Means and the Committee on Finance. In the 
course of our markup, as we say, voting out the tax bill, I requested 
that the Joint Committee give us the distribution of the $245 billion 
tax cut, and they did, including the reductions in the earned income 
tax credit which are tax increases, in my view. If you have to pay more 
tax, you have had a tax increase.
  Sir, here is the data: 51 percent of American taxpayers will have a 
tax increase; 49 percent will have a tax decrease. How we can do this, 
and then talk about fiscal responsibility eludes this Senator.
  Now a second table from the Treasury, showing the actual distribution 
of the tax cuts and tax increases across the population of taxpayers, 
by income. It shows a tax increase for taxpayers with incomes of 
$30,000 or less. I should point out that according to the analysis of 
the Joint Committee on Taxation, 51 percent of American taxpayers make 
$30,000 or less. Once we get above $30,000, then we see tax cuts for 
everyone.
  I am embarrassed for my friends on the other side of the aisle. This 
is a caricature. A comic Democrat might have come along and have said, 
``Let me show you what a Republican tax cut looks like.''
  Families with incomes above $200,000 will have a tax cut of $3,416. 
Families with incomes under $10,000 will have a tax increase. That 
simply is unacceptable.
  Mr. President, the distinguished chairman of the Budget Committee 
earlier spoke about what Thomas Jefferson had to say on the subject of 
debt. I have not met Mr. Jefferson, but you can sense his presence in 
these precincts. The Senator said what Laurence Tribe has said about 
the accumulation of debt. I taught at the same university, and I know 
him well. And the legacy of debt of which the chairman spoke--we are 
the ones appalled by that legacy. We did not create it.
  At the end of the 1970's, at the end of the administration of 
President Carter, the national debt was in the neighborhood of $800 
billion. That was at the end of nearly two centuries in this Republic. 
After 15 years it is now approaching $5 trillion. That did not happen 
accidentally, and it did not happen as a consequence of activities on 
this side of the aisle.
  To the contrary, 2 years ago the Democrats put together, in the 
Omnibus Budget Reconciliation Act of 1993, a combination of program 
spending cuts and ``tax increases''--I do not forbear to use the term--
of $500 billion. And we brought a deficit, which in that year, in 
fiscal 1992 was $290 billion. We started a glidepath down to where this 
fiscal year just concluded, the deficit will be somewhere between $160 
and $170 billion. We cut the deficit in half.
  In consequence of what we did, the so-called deficit premium on 
interest rates was reduced. The deficit premium is simply that extra 
charge which lenders exact when governmental deficits are running very 
high--because in the end the way governments typically have handled 
their debt was through inflation, to wipe it out, wipe out the 
currency, and wipe out the society frequently. But it happens. It 
happened enough that this premium exists. The ``deficit premium'' being 
charged on interest rates went down, and resulted in a savings to the 
Federal Government of about $100 billion more. So in total we achieved 
deficit reduction of $600 billion as a result of the 1993 legislation--
passed without a single Republican vote.
  What have we to show for that? First, let we say that the average 
length of recovery for 10 postwar business cycles has been 50 months, 
but the current recovery has now lasted 55 months and is still going. 
The annual rate of growth in real gross domestic product has been 3.3 
percent, more than twice what it was in the previous 4 years. 
Unemployment has fallen to 5.6 percent, which is very close to full 
employment. The annual inflation rate has dropped to 2.5 percent.
  If you correct for the CPI overstatement, you may have something very 
close to zero inflation. The New York Times this morning devotes a lead 
article in its business section to it. ``Has inflation finally been 
whipped?'' It did not just happen. It was made to happen by what we did 
in 1993, and we do not apologize for a thing. We would rather state we 
have shown the way--shown what you can do, if you have the courage to 
govern. There are things in this 

[[Page S15606]]


present proposal from the majority with which I would disagree. There 
are things with which I would not disagree in the least. I do not 
object in the least to the statement of the Senator from Colorado that 
a reduction in the rate of increase is not a cut.
  However, to cut taxes is an act of unforgiven irresponsibility. I did 
not say ``unforgivable.'' I said the consequences will be unforgiving 
at this moment in our business cycle expansion. We do not need to do 
this and, Mr. President, we would not be doing it save for the House of 
Representatives.
  In our hearings on this subject, in the Finance Committee, one 
Republican Senator after another said no, we have to bring the budget 
into balance. This is no time to cut taxes.
  We do not have to stimulate the economy. The economy is in its 55th 
month of expansion; we are practically at full employment; inflation 
has practically disappeared. Business investment is at the highest rate 
in 30 years--investment savings is at the highest rate in 30 years. 
This is not the time to get into an inflationary stimulus. We know 
enough about our economy to know that.
  One Senator after another from the other side of the aisle said no, 
certainly not; we would never pass a $245 billion tax cut. And then we 
learned that--and I do not mean in any way to seem to ridicule, but it 
turns out that the Contract With America written in the other body 
required this tax cut. And so here it is today. But it is not a tax cut 
for all. It is a tax cut for half the population and a tax increase for 
the other half. That surely is something we would not wish to do in 
ordinary circumstances.
  Has the prospect of a Presidential election brought us to this? I 
hope not, Mr. President. I hope we would not be doing things we are 
doing in the process of cutting, cutting Medicare as much as we do, 
cutting Medicaid as much as we do.
  Mr. President, before this decade is out, we are going to have a 
crisis in our teaching hospitals and our medical schools because of the 
measures in this bill. We currently have in Medicare a provision to 
provide medical schools and teaching hospitals with some extra support. 
We currently have a provision on disproportionate share which in effect 
compensates those hospitals, including teaching hospitals, that treat 
large proportions of the uninsured. They are already in a precarious 
financial position, and the bill before us will exacerbate their 
problems. They will be in genuine jeopardy if this bill becomes law. At 
the greatest moment of medical science for this country's institutions, 
we are decimating their finances in order to give a tax cut to people 
with incomes over $200,000.
  Sir, I believe my time has expired.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. MOYNIHAN. I thank the Chair for its courtesy, and I hope I will 
have the attention of my friends on the other side of the aisle. It is 
not too late to do the right thing.
  Mr. ABRAHAM addressed the Chair.
  The PRESIDING OFFICER. The Senator from Michigan.
  Mr. ABRAHAM. Could I inquire as to how much time is remaining?
  The PRESIDING OFFICER. Thirty minutes of the 1 hour remains.
  Mr. ABRAHAM. Mr. President, I will take 2 minutes on our side and 
then I will yield the remainder of our time to the Senator from 
Delaware. I use my 2 minutes very briefly to be responsive to some of 
the comments that have been made here already about the nature of the 
tax cut. I am sure the Senator from Delaware, the chairman of the 
Finance Committee, will elaborate in more detail. But I was very 
concerned recently when I began to see this chart appear and some of 
the comments related to it that suggested somehow the tax cut that is 
being proposed as part of this reconciliation bill would 
disproportionately fall on the shoulders of the less affluent and 
tremendously benefit the wealthiest among us which is the frequently 
used term that we hear.
  So I said to myself, gee, that does not sound like the tax bill the 
Finance Committee passed. And indeed, I then began looking into the tax 
bill the Finance Committee passed, and according to the Joint Tax 
Committee calculations, in the first year of this tax bill 90 percent 
of the tax cuts will go to people whose earnings are below $100,000 a 
year. Over three-quarters or 77 percent of the proposal's tax cuts will 
go to those making under $75,000 in the first year. Less than 1 percent 
of the proposal's tax cuts will go to those making over $200,000 in the 
first year. Over four-fifths, 84 percent, of the proposal's tax cuts 
will go to those making under $100,000 in the first 5 years; 70 percent 
of the proposal's tax cuts will go to those making under $75,000 in the 
first 5 years, and so on and so on.
  Indeed, charts and statistics can always yield certain kinds of 
inferences, but those are the actual numbers that the Joint Tax 
Committee produced when it evaluated this plan.
  I said maybe there has to be a discrepancy here. What could it be? 
Let me look at the individual provisions of this tax cut and see. In 
order to fulfill the numbers we have been hearing, they must all be tax 
cuts that benefit the wealthiest people in America. So I looked and I 
found a $500 per child tax credit; $141 billion of the total tax cut is 
the child tax credit, and it is phased out for people beginning at 
family incomes of $110,000.
  The PRESIDING OFFICER. The Senator's 2 minutes have expired.
  Mr. ABRAHAM. I would yield myself 1 additional minute.
  In addition, we have an adoption credit, marriage penalty relief, 
student loan interest deduction, individual retirement accounts, and 
countless other provisions in the bill that are aimed at people in the 
income categories I have already referenced, primarily people making 
under $75,000 a year and to a large extent, approximately 85 percent of 
this tax cut to people making less than $100,000 a year. It is a 
middle-class tax cut.
  That is why yesterday, in describing the reconciliation bill, the 
Washington Post in referencing the tax sections described it as family 
friendly. It is family friendly to middle-class families, to people who 
have felt the squeeze for so many years. That is why it is part of this 
legislation and why we are supporting it.
  Mr. President, at this time I yield the remainder of our side's time 
to the Senator from Delaware, the chairman of the Finance Committee.

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